Do We Really Need to Re-Create the Wheat Wheel In Western Canada?

I am attending CropWeek 2013 in Saskatoon this week which always involves some great discussions in the sessions and the hallway.

I had a grain /seed industry insider ask me a really interesting question today.

“Do we really need to re-create the wheel with wheat? Does wheat royalty collection for research really need to be different than the system that exists today?”

As we have been covering on RealAgriculture, there are several things happening in wheat that are causing the appearance of chaos.   Massive increase in the private funding of wheat breeding by CropLife companies and dissolution of the Canadian Wheat Board has created the push to re-configure the way breeding is funded in Canada.  Some people are pushing for an Australian like end point royalty system while others a hybrid version of what happens in other areas around the world.

Adding to all this wheat chaos is the struggle within within the west to organize newly formed wheat commissions and groups.  There is a mad scramble to figure out how the research money will be collected and who will be responsible to collect it.

So having said all the above I am intrigued by the contradictory thoughts mentioned in my hallway discussion.  Should the real focus be on creating more value for the farmer through improved genetics first?  This follows the thoughts of, if  the industry breeds more value into the wheat crop, certified seed sales will grow substantial, similar to the experience in soybeans.   The collection system for royalties already exists and therefore that should not be the focus.  According to the person I was talking to, what needs focus is creating more value for the farmer first and that will fix the lack of royalties going back to breeders.

I’m not sure what I think at this point.  I am very interested in your opinion though. Its your dollars that needs to fund plant breeding whether it be through the current model of certified seed royalties or end point levy’s.  Let us know in the comment box below.

 

 

 

 

Shaun Haney

Shaun grew up on a family seed farm in Southern Alberta. Haney Farms produces, conditions and retails wheat, barley, canola and corn seed. Shaun Haney is the founder of RealAgriculture.com. @shaunhaney

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8 Comments

@WheatPete

End point royalty is the only sure way to reward plant breeding efforts and better genetics. In cereal grains, certified seed has not worked for the last 20 years in Ontario. Do it right first time around.

Reply
josh

I think end point royalties are a great way to reward breeders, public or private for their efforts no matter where producers choose to get their seed. It may hurt a few seedgrowers that are unwilling to adapt but more reward for breeders should mean more varieties, and benifit to agriculture as a whole.

Reply
Richard

If Company A wants to collect end point royalties through driveway and feed mill declarations, and set up remittances by those companies, have at it. If Company B wants to use contracts on seed sales requiring no re-using seed, or only for own use for one additional year, have at it. If Company C just wants to rely on new sales of certified seed each year, have at it. If Company D wants to work with a flour mill, or export buyer to only require grain from certified seed (like the old Snowbird contracts), have at it.

I have two points to make. First, each company will figure out it’s own value capture model and secondly (and most importantly) farmers will only buy any of this seed if there is value back to their bottom lines anyway, and will only agree to whatever the terms are if it makes economic sense for their farm. If a private company wants to charge or collect too much, people will buy from someone else or look to a public variety.

I think it’s that straightforward. 🙂

Reply
Kent

I think chaos is not the term for the wheat industry today. I think some reorganization and thought is needed and is being done to increase the investment in Canadian breeding. Fundamentally industry (which includes farmers!) want a profit and want to see economic return. Canola and other industries have went different routes and they have shown economic return which is why we seed record number of acres each year. Wheat is a different crop (ie 120lbs/ac + instead of 4-5 lbs/ac) and private AND public AND seed growers need to collaborate to come up with a realistic way to gain profit to all sectors. End point royalties is one way that could work well, but the industry will decide together and/or as individuals.
Shaun, specific to your articel I have a hard time with the tone as it portrayes the industry today ‘struggling’ and ‘in chaos’. This industry (including farmers) need to see this as a challenge with OPPORTUNITIES to collectively work together to continue to promote agriculture to our customers. I don’t see chaos and struggle, i see challenges and opportunities for wheat in Canada!

Reply
john

I think part of the discussion for me revolves around future funding for the present model, it seems that everytime the government tries to tighten spending there is a scramble to try and make sure core funding for breeding is not on the block. there is a disconect between what I see as value and my ability to direct and support it properly for my farms sake.

Reply
Brian Rossnagel

Shawn – be careful about who you listen to and what their agenda might be in those hallway discussions as not everyone really has the farmer’s best interest first on their agenda. Just for a bit of perspective on that a well known seed “industry” consultant stated at the 2012 CSTA annual mtg that end-point royalties were not something the seed industry wants to see since those end-point royalties are good for farmers and for plant breeders but not for the seed industry. I think that is a bit of an overstatement since in most arenas these days the seed industry and the breeders are one in the same but it is very true that the end-point royalty system is good for farmers as it encourages the use of your own seed and farm to farm trade of seed with the breeders still getting a fair royalty return and it also rewards the good breeding programs better than the less good. The really good news is that the end-point system spreads the cost over a larger group and is definitely a much fairer system since all beneficiaries pay their fair share.
Brian Rossnagel
Saskatoon

Reply
Shaun Haney

Brian, I have a fairly good read on who I should be listening too and who I shouldn’t. Its not like every stranger that walks up to me I take at their word. Obviously everyone has an agenda of interest, as do you.

In my mind we need a system that allow farmers, seed distribution and breeders to thrive. Farmers currently enjoy the luxury of using innovation without having to pay for it and that model seems somewhat broken and ineffective.

The right answer on all of this just feels very cloudy with no real clear simple answer as of yet.

Thanks for the comments.

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